• Macroeconomics.Argentina confirms a debt agreement and avoids default

  • Macroeconomics.Argentina officially asks the IMF to renegotiate the "unsustainable" agreement of 2018

Argentine President

Alberto Fernández

confirmed on Monday that he achieved the main objective in the first stage of his mandate: a solid agreement to restructure a significant part of the country's foreign debt.

Thus,

Argentina

avoids a new default, which would have been the ninth in the turbulent economic history of the third largest economy in

Latin America.

"In order to reassure Argentina, it was necessary to get rid of the unsustainable debt", highlighted the Minister of Economy,

Martín Guzmán,

when announcing with Fernández and the vice president,

Cristina Fernández de Kirchner,

that "99% of the debt was restructured ".

"This puts Argentina in a healthier and more solid situation compared to the one it faced on December 10, 2019. Argentina will have

debt relief of $ 37.7 billion,

and the interest rate drops from 7% to 3.7%, allowing us greater relief to recover the economy, "he added.

The restructuring of the $ 66 billion debt with bondholders issued under

New York

jurisdiction

was a tough nut to crack for the Argentine government.

Guzmán had to present five proposals, in which he was yielding more and more with respect to his original proposal,

some 20,000 million dollars

in total, to achieve the acceptance that he announced this Monday.

Thus, Fernández will have to

face maturities of 4.5 billion

dollars during the remainder of his term, which ends in December 2023, but he managed to postpone the bulk of the payments for later years.

The Argentine president turned the announcement into an act with the main figures of his party and most of the

governors, including opponents.

Fernández was notoriously satisfied: "To those who say 'I'm leaving this country of the devil', or 'the day Alberto won I lost hope', let them realize what this country is capable of doing in the midst of so much crisis ".

Argentina has been in recession for two years, a situation notably worsened by the coronavirus crisis.

Inflation of 50% per year does not seem to be controlled and

poverty has grown above 40%,

according to private estimates.

The objective is now to

renegotiate the debt of 44,000 million

dollars with the

International Monetary Fund (IMF),

for which talks have already begun.

According to the criteria of The Trust Project

Know more

  • IMF

  • Alberto Fernandez

  • Cristina Fernández de Kirchner

Argentine pandemic stricken with poverty after record 150-day quarantine

MacroeconomicsArgentina officially asks the IMF to renegotiate the "unsustainable" 2018 agreement

EconomyArgentina is about to close an agreement for the debt and renounces to expropriate the Vicentín company

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